Alliance News) - European Assets Trust PLC on Thursday said it delivered a "pleasing" first half with an increased net asset value and stable dividends, but warned that the wider climate gives reason to be pessimistic.
The London-based trust, which invests in small to mid-cap EU companies, said its NAV at June 30 was 98.7 pence per share, up from 96.5p at December 31. Total return for the first half of 2023 was positive 5.2%, surpassing the positive 2.9% benchmark and vastly improved from the negative 31.4% return for the same period in 2022.
European Assets shares were down 0.4% at 89.21p in London on Thursday.
"It has been a better half for our portfolio with our NAV total return outperforming the benchmark in an environment that rewarded stock picking," commented Chair Jack Perry. "Some of our long-term themes such as health and wellness, digitalisation and consumer brands reasserted themselves following a tough last year.
"Unfortunately, our share price failed to keep pace with our NAV as our discount widened, a trend that has been seen across most of the investment company sector."
However Perry also warned that while 2023 "started optimistically," much of Europe then saw declining growth or recessions due to higher rates and high-profile bank collapses. Consequently, "the first half of 2023 has therefore concluded on a more pessimistic note."
Still, he acknowledged that "after a disappointing 2022, the company's recent performance in a difficult market for European equities is pleasing," although "we still have much to do to make up the ground lost last year".
"Accordingly, we are not complacent and are conscious that the macro-economic and volatile geopolitical environment provides a continuing challenge for stock pickers. However, history shows that volatility can provide opportunity."
European Assets has committed to paying 5.80p per share in total dividends for 2023. It consists of four equal 1.45p instalments, three of which have been paid.
By Emma Curzon, Alliance News reporter
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European Assets Trust (EAT)